Transcript: Rep. Paul Ryan on 'FNS'

The following is a rush transcript of the February 28, 2010, edition of "Fox News Sunday With Chris Wallace." This copy may not be in its final form and may be updated.

CHRIS WALLACE, ANCHOR: In the health care summit this week, there was one Republican President Obama didn't want to mess with, someone who knows as much about the issue as he does.

We want to go inside the numbers of health care reform with Wisconsin Congressman Paul Ryan, the GOP's top man on the House Budget Committee.

Congressman, one of the big disagreements — in fact, perhaps the first big disagreement at the summit — was the question of whether or not the Democratic plan would raise or lower people's—

REP. PAUL RYAN, R-WIS.: Right.

WALLACE: — health care premiums. Isn't it true, in fact, that most Americans would end up paying less?

RYAN: No, it's not true. The Congressional Budget Office says they will get higher premium increases, 10 to 13 percent. Private actuaries put those premium increase in the double-digit to triple- digit territory.

The Blue Cross plans are telling us they're going to see a massive spike in premiums for people. That's the problem. What we're hearing coming out of Washington, the rhetoric, doesn't match the actual facts that are underneath this legislation.

WALLACE: Well, let me ask you about that, because I want to put up — you know, for lack of anybody better, we're dealing with the Congressional Budget Office, nonpartisan agency, and here's what they said. Let's put the numbers up on the screen.

It said that for those in large group policies there would be somewhere between no change and a 3 percent decrease in premium costs. And it said for those in the individual market, the average premium, as you said and as Lamar Alexander said, would go up 10 to 13 percent.

But the CBO added that those folks would get better policies, and well over half would get subsidiaries, quote, "that would reduce their costs well below the premiums that would be charged for such policies under current law." Congressman?

RYAN: Well, if you add these — if you add subsidiaries, sure. But let's get this point clear. We're not going to have more insurance competition under this new law. We're going to have less insurance competition. That's going to increase prices.

And if you put more mandates on insurance, as this does — this federalizes the regulation of health insurance, displacing states' rights - - that's going to make it more expensive.

So what this bill attempts to do is, yes, make health insurance much more expensive and then just have Washington subsidize more of it to try and limit people's out-of-pocket costs. That's a deficit nightmare. It's a cost nightmare.

And so you will be putting more costs onto the backs of the taxpayers at the end of the day here.

WALLACE: All right. Well, let's talk about the question of costs, because that was something that you brought up with the president.

RYAN: Yeah.

WALLACE: Another big disagreement is whether, as you said, the Democratic package bends the cost curve of government spending—

RYAN: Right.

WALLACE: — up or down, as the Democrats claim. And again, let's go to the CBO, which says that the Senate bill would cut the deficit by $132 billion over the first 10 years.

RYAN: OK, so the CBO has to score the legislation that's put in front of them. And the legislation that's been put in front of them is full of smoke, mirrors and gimmicks.

Let me give you an example. It double counts Medicare cost savings. It double counts increased taxes for Social Security, increased premiums for this new CLASS Act.

If you take all the double counting out of the bill, which the CBO can't do because that's the way it's put in front of them, this thing has a $460 billion deficit in the first 10 years, a $1.4 trillion deficit in the second 10 years.

WALLACE: Well, explain the double counting, because you made a—

RYAN: Right.

WALLACE: — big point of that at the summit.

RYAN: OK. So two things. This bill looks like it reduces the deficit because they raise taxes a half a trillion dollars over 10 years and cut Medicare a half a trillion dollars over 10 years to pay for six years of spending.

So 10 years of tax increases and Medicare cuts with six years of spending makes it look as if this thing reduces the deficit. And then if you double count those tax increases, those Medicare cuts, which this does do —

WALLACE: Well, explain the double counting, though.

RYAN: — that's the whole smoke and mirrors.

WALLACE: What do you mean, double counting?

RYAN: Right. So they're bringing in more money for premiums to pay for a new entitlement called the CLASS Act. You can't count that premium increase for deficit reduction.

They're taking more money in Social Security taxes, which is reserved for Social Security benefits. And if it's — if you're not going to pay those benefits, then you can use it. But you can't count it both for paying benefits and reducing the deficit.

If you're going to say that all these Medicare cuts are improving the solvency of Medicare, which is what they say, then you can't use that money to spend on the creation of another government program.

So what they're doing is they're raiding a half a trillion dollars from Medicare to pay for a new government program. And you can't say that's going to improve Medicare, which is what they're saying. So—

WALLACE: But — but—

RYAN: — in each of these cases they're counting the numbers twice.

WALLACE: OK, but let — but let me ask you this, because the CBO says — let's — again, we have to go back to them as the umpire in this whole deal—

RYAN: Right.

WALLACE: — that once revenue and spending have all kicked in, because you talk about 10 years of revenue, six years of spending, they're saying that once it's all kicked in, the revenue will still exceed the spending. And in fact, it says, "The CBO estimates that enacting the legislation would not cause a net increase in deficits — would not cause a net increase in deficits in excess of $5 billion in any of the four 10-year periods beginning after 2019."

They're projecting out 50 years and saying that if it has any impact on deficits, it'll be only minimal.

RYAN: Now, there are a couple — I can go great into the detail here, but one of the things they're saying is—

WALLACE: No, please — please don't do that.

RYAN: OK. One of the things they're saying is we're putting this new commission in charge of Medicare that is not elected, unelected bureaucrats, to ration care and put the clamps down on spending.

And they're saying if this commission does its job, cuts Medicare even more across the board, then that will happen. Other point is the president's own chief actuary of Medicare and Medicaid is saying quite the opposite. He's saying this is going to increase health care costs by $222 billion over the first 10 years, and so instead of bending the proverbial cost curve down, it's going up.

So when you actually look at a real-life look at how these numbers add up, and you take out the smoke and mirrors that the CBO can't take out in their analysis, it reveals these things as not being true.

Let me just give you another point.

WALLACE: Can I — well, let me just—

RYAN: OK, go ahead.

WALLACE: — because I want to go on to another subject, malpractice, because in the summit, Republicans kept talking about malpractice reform, limiting doctors' liabilities.

And in fact, House leader, your leader, John Boehner said that medical malpractice and defensive medicine are the single biggest driver of medical inflation. That isn't true, is it?

RYAN: Well, it's one of the biggest drivers. I think there are other contributing factors which are not being addressed in this bill. But it's a huge contributing factor.

WALLACE: Well, let me — let me just pick up on that, because again, the CBO says — and let's put up the numbers — that malpractice reform would reduce total U.S. health care spending by about 0.5 percent. That's one-half of 1 percent, about $11 billion in 2009.

I mean, the fact is drugs, and technology, and an aging population are much bigger drivers of medical inflation than malpractice, aren't they?

RYAN: Right. What CBO measures is, you know, the cost of government. And they say, "We'll have $54 billion of savings with medical liability reform."

What they cannot measure — and I understand why they can't measure this. They can't measure all of that defensive medicine. They can't measure all the additional tests that are being ordered by doctors, not because it's good health care, because it's good liability protection. They don't measure all of that.

So there's a lot of stuff that is not being measured that we would appreciate from if you actually did medical liability reform. So what John Boehner is saying is if we actually get rid of the process of defensive medicine by having real tort reform, that would give us a lot more cost savings. Those are cost savings that the CBO just can't measure. WALLACE: All right. Let's turn to another subject — and there's certainly no disagreement about the numbers here — which is the question of coverage.

The Democrats say that their plan would cover 30 million uninsured — currently uninsured Americans, would give them health insurance coverage. The Republican plan would cover 3 million. What happens to the 27 million- -

RYAN: Well—

WALLACE: — other Americans?

RYAN: Well, there — there's lots of Republican bills. That's one particular bill the president was talking about. The president referenced the bill that I have with Tom Coburn, Devin Nunes and Richard Burr which covers those 30 million people, which gets us toward full coverage in America without all these new tax increases, without all these Medicare cuts.

So we believe we can get to the same coverage numbers without having a government takeover of health care.

WALLACE: Well, how do you—

RYAN: So we've been—

WALLACE: Very briefly and generally—

RYAN: — offering these ideas all year.

WALLACE: — how do you do that? How do you get — how do you cover 27 million other people?

RYAN: We propose to do it through refundable tax credits, to give people the ability to have tax credits by ending the discrimination against people who don't buy health insurance from their jobs. And we say there are better ways of doing this.

So there are lots of Republicans' ideas that have been offered all session long to get at this coverage number without massive tax increases, Medicare cuts and a government takeover of health care.

The point is we haven't — we've been frozen out of this process, Chris. The only time we've had bipartisan discussion, you've seen it, because it's been on TV. We've been frozen out of this process all session long, and it's quite clear to us that they're really not interested in engaging in collaborating and bipartisanship. They want to jam this thing through.

WALLACE: All right. We have about two minutes left. I want to get into one last area with you, preexisting conditions. All sides agree that there needs to be reform that prevents insurance companies from keeping out people who have preexisting—

RYAN: Right.

WALLACE: — medical conditions. The White House says — Democrats say, "Hey, look. The only way you can do that is by having an individual mandate that everybody get insurance so you have these big pools. Otherwise, people will game the system. They won't get health insurance until they get sick. And then they'll say, 'I want to buy a policy.'"

RYAN: That is not the only way to do it. And the Republican alternative says there's a better way to do it, which is well-funded high- risk pools in the states that make sure we target subsidies to those people who have preexisting conditions.

You accomplish two things by doing that. You make sure that that person who has a chronic disease gets the need — gets the care they have and they need so that they don't go bankrupt when they get sick. And by subsidizing their coverage, you actually lower the price of health insurance for everybody else.

Unlike the Democratic plan — it raises everybody's health care cost. So what we're saying is you don't have to unnecessarily raise everybody's premiums to help those with a preexisting condition. Let's target and focus our support to those with preexisting conditions to help them get affordable coverage.

And by doing it the way we're proposing to do it, you actually lower everybody else's premiums. We think that's a better idea and you can do it without making everybody buy health insurance.

Look, this is a new—

WALLACE: And—

RYAN: Let me give you this. They're saying you have to buy what the federal government defines. We've never done that before.

Does — do the Democrats have a majority of votes to get the comprehensive health care plan through the House?

RYAN: They do not now have the votes from our best count. I wouldn't count her out, because she is very good at muscling votes. They were down 24 on cap and trade the night before. They passed it by eight.

So the speaker is very good at making deals behind closed doors and muscling votes, but right now they don't have the votes.

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